However hard the market slams a stock, there's always the chance it'll come bouncing right back. We'll consult our Motley Fool CAPS community to find shares on the rebound, by examining one specific sector of the economy in search of companies with rising CAPS ratings.

Among the 1,557 stocks in CAPS' financial sector, we've unearthed a handful with four-star ratings out of a possible five. Those accolades mean our 135,000 CAPS investors are confident that these stocks will beat the market in the months ahead:


CAPS Rating Today

Recent Price

52-Week Price Change

Estimated 5-Year Growth Rate

Apollo Investment (NASDAQ:AINV)





Charles Schwab (NASDAQ:SCHW)










E*Trade Financial (NASDAQ:ETFC)





First Marblehead (NYSE:FMD)





Sources: Motley Fool CAPS, Yahoo! Finance, and Capital IQ (a division of Standard & Poor's).

Even though the average company in the financial sector lost about 32% of its value over the past year, there were still some notable high performers, such as Ocwen Financial, which has seen its stock double, or online brokerage and education provider thinkorswim, which has climbed by 29%. So let's take a closer look at why investors might think some of these companies won't be jumping from the frying pan into the fire.

Spring in its step
Even though the government already provides fistfuls of money for education, private companies such as loan servicer and securitizer First Marblehead and Citigroup's Student Loan Corp. (NYSE:STU) facilitate loans for students who still find themselves short when the tuition bill comes due. Although student-loan companies are limited to charging rates set by Congress, the government guarantees the loan in the event of a default.

President Obama has presented a program that would radically shake up the industry, however.

Under Obama's proposal, the Federal Family Education Loan program would be eliminated, and students would instead borrow directly from the government. The move would cause the world's largest student-loan company, Sallie Mae (NYSE:SLM), to lose as much as 74% of its loan portfolio, and First Marblehead and others could be devastated by the proposal. Even so, Sallie Mae has agreed to go along with the idea, figuring it can cement some market share if it's allowed to originate and service those government loans for a fee.

CAPS investors are lending First Marblehead the benefit of the doubt. While noting the risk associated with establishing a position in the company, highly rated All-Star CAPS member GunnarVagotis thinks that the company could recover from the credit crunch -- assuming it still has a business left to service: "Taking a chance on a stock that is not directly tied to mortgages and the toxic debt explosion but has been swept up in the credit crunch. A very risky pick for a [real-life] portfolio but big potential, at least in CAPS."

If Obama's initiative goes through unchanged, though, students will be able to get both an education and a car, courtesy of the federal government.

The ball's in your court
Many factors go into whether a stock is a buy or a sell, so it pays to start your own research on these stocks at Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made -- all from a stock's CAPS page. Head over to CAPS today, and share your thoughts with other investor analysts on whether you think these stocks are ready to bound higher.

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Fool contributor Rich Duprey has no financial position in any of the stocks mentioned in this article. You can see his holdings. The Motley Fool has a disclosure policy.